BreakingChina State Council guideline prioritises land use for free-trade zones, sets stage for further liberalisation
- Priority will be given to development of FTZs when authorities map out land use plans, according to guideline
- Shanghai vice mayor says city’s FTZ to be expanded, will be ‘very big’ in future
China’s State Council issued a guideline on Friday prioritising land use for the country’s 12 free-trade zones. All ministerial-level authorities and local governments have been urged to build these zones into gateways that connect foreign investors with the mainland economy.
The guideline is being viewed as a precursor to a series of drastic liberalisations, which follow comments by Chinese President Xi Jinping on November 5 that Shanghai would get a much larger FTZ with fresh incentives to attract global investors. He was speaking during the opening of the China International Import Expo.
President Xi breathes new life into Shanghai FTZ as he hopes to replicate reforms across China
According to the guideline, “priority will be given to the development of FTZs” when authorities map out land use plans. It said: “Healthy and orderly development of the zones will be ensured.”
Wu Qing, a Shanghai vice mayor, told reporters on the sidelines of the expo that the expanded FTZ would be “very big”, but did not disclose details of it size and of new area to be added. Shanghai’s FTZ, established in 2013, was dubbed a mini-Hong Kong, but liberalisation inside the 120 square kilometre zone have failed to live up to investors’ expectations so far.
There has been some speculation that the FTZ in Shanghai would be expanded to include the whole Pudong area, which covers 1,200 square kilometres.
“The ultimate goal is to facilitate cross-border commodity and fund flows, to create a friendly business environment for foreign investors,” said Chen Bo, a professor at the Huazhong University of Science and Technology and adviser to local governments including that of Shanghai. “A larger geographic size will have some substance, given the leadership’s resolution to deepen reforms.”
Beijing has been working to widen overseas investors’ access to the vast mainland market this year, after the US-China trade war triggered concerns about the outlook for the Chinese economy and caused some foreign businesses to consider moving their production out of China.